Property giant's confidence lifts FTSE

LONDON FTSE 100 CLOSE 5,923.49 +62.49

London's blue chip index broke its five-day losing streak yesterday as property firms surged ahead after Land Securities said the firm's markets were in "recovery mode".

Shares in the real estate investment trust jumped 6 per cent and drove gains across the sector after it reported an 18 per cent jump in its net asset value and chief executive Francis Salway reported hopeful signs for demand in London.

Hide Ad
Hide Ad

A rally for heavily-weighted miners and energy companies also helped drive the FTSE 100 Index up 62.49 points to 5,923.49, a rise of 1.1 per cent.

The pan-European FTSEuro-first 300 index of top shares closed up 0.4 per cent at 1,131.45 points, boosted by technology stocks that basked in the glow of Dell's better-than-expected figures after the US markets closed on Tuesday. But trading was light, with volumes just 78 per cent of the 90-day average.

Richard Batty, global investment strategist at Standard Life Investments, warned: "The market is rising on Wall Street, but volumes are light. In the medium to longer term, we are underweight European equities."

The pound was down against the euro and the dollar after six of the nine-strong monetary policy committee at the Bank of England voted to keep rates on hold at 0.5 per cent.

Higher-than-expected unemployment figures also depressed sterling, which was at $1.62 against the greenback and €1.13 against the single currency. A weaker dollar helped volatile commodity prices rise, as Brent crude gained 1.7 per cent to $112.5 and copper also rebounded.

Mining stocks in London were also lifted after Bank of America Merrill Lynch said a survey of fund managers for May showed investors growing more confident in Japan's ability to rebound from the earthquake and tsunami disasters.

Eurasian Natural Resources was among the biggest risers, up 34.5p to 841p, after Citigroup upgraded it to "buy". Randgold Resources was up 177p to 4,797p as gold prices rose and Kazakhmys was up 39p at 1,256p.

But the main focus was on the property sector after Land Securities was up 48p at 795.5p, British Land was ahead 26.5p at 604.5p and Hammerson gained 15p to 479.2p.

Hide Ad
Hide Ad

The cheer failed to extend to catering company Compass, even though it announced a 12 per cent rise in half-year operating profits and rewarded shareholders with a 30 per cent dividend hike. The stock opened higher but later fell back to stand 4p lower at 575p.

There was also weakness in the retail sector, with Sainsbury's dropping 10.7p to 344p after its shares went ex-dividend, and with a drop of 13.9p to 209.1p for Argos-owner Home Retail Group.

Mothercare was one of the top risers in the second tier after the babycare products retailer outlined plans to close more than 100 high street shops over the next two years.Investors welcomed the strategy as shares jumped 5 per cent or 23.3p to 448.5p, despite Mothercare reporting a drop in 2010 profits.

Aberdeen-based SeaEnergy fell 6.25p or 9.8 per cent to 57.5p after the firm said there was no update to give on the potential sale of its renewable energy subsidiary. Its shares had jumped 30 per cent on Tuesday.